The Daily Intelligencer has a fine article on corruption in the student loan industry (and the Trump administration’s complicity therein).
First, it describes the problem:
“In the United States today, 44 million people carry $1.4 trillion in student debt. That giant pile of financial obligations isn’t just a burden on individual borrowers, but on the nation’s entire economy. The concomitant rise in the cost of college tuition — and stagnation of entry-level wages for college graduates — has depressed the purchasing power of a broad, and growing, part of the labor force. Many of these workers are struggling to keep their heads above water; recent research suggests that 11 percent of aggregate student-loan debt is more than 90 days past due or delinquent. Other borrowers are unable to invest in a home, vehicle, or start a family (and engage in all the myriad acts of consumption that go with that).”
“Just about all of America’s institutions of higher learning are complicit in this sorry state of affairs. But for-profit colleges have been far and away the most malevolent actors. The entrepreneurs behind such schools looked at the masses of Americans struggling to claw their way up the socioeconomic ladder — and then at the giant stack of federal student loans available to such strivers — and hatched a plan for “disrupting” the higher-education market: Whereas many traditional universities had inefficiently concentrated their capital on research centers, student services, and faculty, for-profit colleges recognized that an ounce of marketing was worth a pound of quality instruction. Providing students with a good education and competitive job opportunities is a difficult, time-consuming, capital-intensive endeavor — but leading students to believe that you can provide them such things could be done with a few targeted investments in video and graphic design.”
Read the article for all of the gory details.
Final quote: “In a bizarre coincidence, DeVos has close financial ties to a debt collection agency that does business with the Education Department.)”
Nothing bizarre about that. I expect nothing less from this administration.